New York Denies Northern Access' Water Quality Certificate

The New York State Department of Environmental Conservation (NYSDEC) has denied the Water Quality Certificate (WQC) for National Fuel Gas' Northern Access Project 2016. In response, National Fuel can address the deficiencies noted by the NYSDEC through a rehearing or reapplication process, or by filing an appeal in federal court, likely the U.S. Court of Appeals for the Second Circuit.

Notably, the Second Circuit -- after nearly 11 months -- has not issued a decision on a similar issue involving the Constitution Pipeline. But, unlike in the Constitution case, where the NYSDEC said it lacked sufficient information to grant the WQC, the NYSDEC stated that the information provided by National Fuel for the Northern Access Project demonstrated that the project could not be built in the manner proposed without violating New York's water quality standards.

The NYSDEC noted that on three separate occasions it had asked the Federal Energy Regulatory Commission (FERC) to prepare a full Environmental Impact Statement rather than an Environmental Assessment, and that FERC had ignored those requests. But the primary basis for the denial appears to be premised on the fact that National Fuel would not use trenchless methods (Conventional Bore or Horizontal Directional Drill) for the crossing of eight high value streams that the NYSDEC had identified. All eight of these streams were Class C streams, which is the next-to-lowest valued streams in New York's classification system.

At the end of its decision, NYSDEC noted that National Fuel has a right to a public hearing on the denial of the WQC, and that a request for hearing must be made in writing within 30 days of the date of the notice. The NYSDEC also explained that should National Fuel wish to address the deficiencies identified in the decision, it must do so by filing a new application, which presumably would give the NYSDEC another year to consider the issue.

In addition to this significant setback, Northern Access also has applications for two Air State Facility permits for two compressor stations that are pending before the NYSDEC. In the case of Dominion's New Market Project, NYSDEC's delayed issuance of the permits led to substantial delays in the start of construction. Therefore, regardless of the outcome in likely litigation related to the denial of its WQC, other permitting issues remain for the Northern Access Project.